5.  The applicants were born in 1955 and 1958, respectively, and live in Szolnok.
6.  The applicants intended to set up an enterprise and started to raise funds in March 1994. They contacted a loan agency and signed a real estate sales contract with an individual concerning their detached house on 12 March 1994. Change of ownership was registered on the basis of this contract on 14 July 1995.
7.  In August 1995 the applicants brought an action before the Szolnok District Court requesting the court to order restitutio in integrum by declaring the contract invalid. The fact of the existence of these proceedings (perfeljegyzés) was registered in the Land Registry. This case ceased after a six-month stay by mutual agreement of the parties. However, for unknown reasons, the registration of the proceedings was not deleted from the register until July 1998.
8.  In June 1998 the real estate was sold to a third party. After the deletion of the registration of the civil proceedings described above from the land register, the new owner was entered in that register on 25 August 1998. On 21 September 1998, after having been informed about these events and having unsuccessfully attempted to settle the case otherwise, the applicants brought an action before the Szolnok District Court, identical to the previous one, together with claims about other loan contracts between the same parties.
9.  On 4 March 2004, after holding a hearing in June 2002, the District Court dismissed the applicants’ action in part. It established that, although the contract was ostensible, restitutio in integrum was impossible since the applicants had failed to bring their action before the court in due time.
10.  The District Court pointed out that the purchase contract evidently concealed a loan and was thus invalid. However, this could not have any effect on the acquisition by a third party, whose good faith had not been successfully challenged by the applicants. It relied on paragraph 31(2) of Law-Decree no. 31 of 1972 on the Land Registry which provided – in order to secure the legal certainty of the real estate market – that in such disputes, a third-party proprietor could not be deprived of his acquisition after sixty days of his date of entry in the register, provided that he had acted in good faith and the decision to make the entry in the register had been served on the former owner.
11.  However, applying paragraph 237(2) of the Civil Code, the court restored the financial balance between the parties, taking into account the ostensible purchase contract and other loan contracts. All in all, it obliged the defendants to pay the applicants 8,082,214 Hungarian forints (HUF) (approximately 32,300 euros (EUR)) plus accrued interest, from which HUF 4,160,000 (approximately EUR 16,300) was to compensate for the loss of the property.
12.  All the parties appealed. The Jász-Nagykun-Szolnok County Regional Court upheld the first-instance decision on 20 October 2004.
13.  The Regional Court confirmed that restitutio in integrum was impossible in this case, although it gave different reasoning. It noted that the sixty-day deadline could not be applied since the decision to enter the third party’s acquisition in the register had not been served on the applicants. It also observed that, flowing from the above-mentioned provision of the Law-Decree, after three years no change could be made at all to this entry in the land register. It further stated that paragraph 63(2) of the new Act on the Land Registry (no. 141 of 1997) ruled the same way. The Regional Court saw no reason to depart from the remaining findings of the District Court, including the value of the real estate, which was not in dispute during the appellate proceedings.
14.  The applicants lodged a petition for review with the Supreme Court. On 24 May 2005 the Supreme Court dismissed their petition.